April 12, 2024
Functional Ingredients Market

The Global Functional Ingredients Market Is Driven By Growing Health Awareness

Functional ingredients are composed of compounds that have health benefits beyond basic nutrition. Functional ingredients are commonly incorporated into foods and dietary supplements to provide additional health benefits such as heart health, immune support, bone health, weight management and more. The growing consumer demand for healthier, niche food and beverage products has positively contributed to the demand for functional ingredients. Manufacturers are increasingly utilizing functional ingredients in applications such as plant-based milk and meat alternatives, bakery products, sports nutrition, energy drinks and others to enhance their nutritional profile.

The global Functional Ingredients Market is estimated to be valued at US$ 94.31 Mn in 2024 and is expected to exhibit a CAGR of 5.3% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.

Market key trends:

One of the major trends witnessed in the functional ingredients market is the growing demand for clean label ingredients. Clean label refers to an ingredient made from straightforward sources without artificial additives and chemical names that are difficult to pronounce. Consumers are increasingly preferring recognizable and simple ingredient labels with no artificial components. This has prompted ingredient manufacturers to offer clean label ingredients derived from traditional and natural sources. Furthermore, the growing consumption of healthy beverages especially among millennials is fueling the demand for functional ingredients in the beverage industry. Manufacturers are developing beverages fortified with minerals, vitamins, proteins and other beneficial ingredients to offer additional nutrition.

Porter’s Analysis

Threat of new entrants: There is moderate threat of new entrants in this market due to established patents and regulatory procedures for new functional ingredients.

Bargaining power of buyers: Buyers have moderate bargaining power due to availability of substitutes and transparency in pricing of functional ingredients.

Bargaining power of suppliers: Suppliers have low to moderate bargaining power due to availability of alternatives and significance of economies of scale for manufacturers.

Threat of new substitutes: Threat of new substitutes is moderate as new delivery systems and processes are constantly being researched.

Competitive rivalry: Competition is high among existing players to develop novel formulations.

Key Takeaways

The Global Functional Ingredients Market Demand is expected to witness high growth. The global Functional Ingredients Market is estimated to be valued at US$ 94.31 Mn in 2024 and is expected to exhibit a CAGR of 5.3% over the forecast period 2024 to 2031.

Regional analysis

North America is the largest market for functional ingredients owing to rising chronic diseases along with strong product pipeline. Europe is the second largest region led by Germany, UK and France due to focus on preventive healthcare. Asia Pacific exhibits high potential supported by growing middle class population with higher disposable incomes in China, India and Japan.

Key players

Key players operating in the functional ingredients market are Alkremes Plc., Teva Pharmaceutical Industries Ltd., Glenmark Pharmaceuticals, Titan Pharmaceuticals, Inc., Pfizer, Inc., GlaxoSmithKline plc., Johnson & Johnson, Perrigo Company plc., Cipla Limited, Hikma Pharmaceuticals Plc., Dr. Reddy€TMs Laboratories Limited, Indivior Inc., and Mylan N.V. These companies are focusing on new product launches and expansion in emerging markets through strategic partnerships.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it